It's a huge morning for the US economy

It has been a huge morning for the US economy as the housing
market and the health of US consumers is in focus.

Here's what we learned:

The housing market is solid.

Consumers are a little concerned about the stock market.

Home Depot is a monster.

To kick off the morning, Home Depot
reported earnings before the market open that beat
expectations, with the company's same-store sales, or sales at
stores open at least a year, rising 8.9% in the fourth quarter.

The company also raised its dividend, announced a share-buyback
plan, and said sales would increase 5.1% to 6% in 2016.

Home Depot is a great barometer not just for the US housing
market, but for the US consumer in general, and this chart from
Rob Wilson at Tiburon Research Group shows how much of a
powerhouse the company has been over the past couple of years.

The homebuilding giant Toll Brothers also
reported earnings before the bell Tuesday morning that beat
expectations, with revenue totaling $928.6 million for its fiscal
first quarter, topping expectations for $910.8 million.

The company's average home price in the quarter hit $873,500.

But the real takeaway from the company's report was its
commentary on both the labor market and the US economy in
general. And it was almost all bullish.

So not only is Toll Brothers building nicer homes — which may or
may not be a good thing, given that
late last year we argued that affordability would be a
growing issue in the housing market in 2016 — but it can't find
enough workers to get the job done. Higher wages, anyone?

Additionally, Toll Brothers executive chairman Robert Toll said:
"The stock market seems to be pricing in a steep decline in
the economy and, along with it, our sector. We, on the
other hand, are seeing signs that reflect strength and positive
momentum in our business based on six consecutive quarters of
year-over-year contract growth in both dollars and
units. Our average contract sales pace per community was
also up this quarter versus one year ago, and we believe it still
has room to grow."

This quote perfectly captures the theme we've been
hammering on: Wall Street might be spooked, but the Main Street
economy is doing better than fine.

On Tuesday morning we also got home-price data from the
Case-Shiller report, which showed that home prices rose 0.8% in
December from November and 5.74% year-over-year. These increases
were slightly below expectations but showed continued improvement
in home prices.

The January report on existing-home sales, which was
expected to show the pace of sales declining 2.5% after
December's report showed the largest-ever increase of 14.7%, beat
expectations as sales rose 0.4% in January.

However!

Toll Brothers CEO Douglas Yearley noted that in February the
company's sales were basically flat compared with the same period
last year. And Yearley pinned much of this trepidation on
financial-market turmoil, saying: "Deposits and contracts
signed in the first three weeks of February, the start of our
second quarter, were basically flat compared to the prior
year.This is understandable given the recent
stock market decline and global economic uncertainty."

Lynn Franco, director of economic indicators at The Conference
Board, said Tuesday: "Consumers' assessment of current
conditions weakened, primarily due to a less favorable assessment
of business conditions.Consumers' short-term
outlook grew more pessimistic, with consumers expressing greater
apprehension about business conditions, their personal financial
situation, and to a lesser degree, labor market prospects.
Continued turmoil in the financial markets may be rattling
consumers,but their assessment of current
conditions suggests the economy will continue to expand at a
moderate pace in the near-term."